INTERNATIONAL REPORT

INTERNATIONAL REPORT; Israelis Revolutionize Hair Removal Industry

By SABRA CHARTRAND, Special to the New York Times

Published: October 10, 1988

KIBBUTZ HAGOSHRIM, Israel—
For the 350 families of this collective community in the Upper Galilee, the outlook is bright. Officials of their kibbutz-owned factory are confident that worldwide sales of the Epilady hair remover, which the factory began making two years ago, will double, to $60 million.

The hand-held device, developed by two Israeli engineers in 1985, has revolutionized hair removal, set off a stampede of imitators and competitors and grown almost overnight into one of Israel's largest nonmilitary exports.

But the booming business has also created problems for its owners. The factory and the Israeli military are reportedly competing with one another for the limited supply of metal springs they both need, and the company has had to spend millions of dollars battling patent infringement around the world.

Introduced in the Israeli market in 1986, the machine, about the size of a telephone receiver, uses a motor-powered rotating spring to remove body hair by tearing it out at the root. Immediately Popular

During the first year, 200,000 units were made and sold in Israel. Despite minor pain caused by the removal, the device was immediately popular among women wanting a clean, simple way to remove hair.

With Epilady, most women need about 20 minutes to depilate their legs. And because the hair is removed by the root, the treatment lasts for at least a week. By comparison, shaving must be done almost daily and waxing is messy and painful.

Epilady was designed by Yair Dar and Shimon Yahav, two Israeli engineers who had their wives test the device through its early stages of development.

Kibbutz Hagoshrim, which was founded in 1948 and whose name means ''the bridge builders,'' agreed to back Mr. Dar and Mr. Yahav after the engineers failed to interest any major Israeli manufacturer. The kibbutz, which also earns income from a hotel and agriculture, already had a company named Mepro that manufactured carpenters' levels and military optics.

In 1987 the Mepro factory began exporting the hair remover and sales totaled $30 million.

Mepro said that retail sales of Epilady in the United States alone have already reached $100 million this year, and predicted that figure would double between October and Christmas.

Mepro's astounding growth makes it Israel's largest exporter of non-military electronic equipment. Before it started to export Epilady, Mepro set up four marketing areas worldwide and four continental distribution areas. It now ships to more than 40 countries, including the United States, which accounts for about 75 percent of foreign sales. 'Nothing Has Changed'

Mr. Baruch, who went to the kibbutz from Turkey 18 years ago, said: ''I don't think the success of Epilady has impacted on the kibbutz yet. In our daily life style nothing has changed. Maybe we have a little bit better food.''

Israel's three kibbutz movements, encompassing nearly 400 collectives, have been burdened with large debts - incurred in the financing of unprofitable factories and other enterprises.

But Mepro has extended its success with Epilady to other struggling kibbutzim and subcontractors. About 1,000 people are employed in other factories.

About 30,000 to 40,000 units are produced daily, and Mr. Baruch said that five million of the depilatories have been sold worldwide, with more than three million exported to the United States in 1987 and 1988. Mr. Baruch declined to disclose his company's profits for either year. Marketing Drive in U.S. In the United States, the hair removers had been sold only in department stores like Bloomingdale's, Macy's and Bullock's. But this month, Mepro began mass-marketing its present model at K Mart, Wal-Mart and Osco Drugs, and through mail-order catalogues, for about $50.

A package called Epilady Trio, a new three-speed hair remover, is also available at J. C. Penney's for about $70. And Mepro's newest design, a three-speed, cordless and rechargeable unit called Epilady Ultra, replaces the standard model in department stores and sells for $89.

Mr. Baruch said Mepro is also planning to manufacture and export Episauna, a portable facial sauna, and a line of mineral-based cosmetics.

Meanwhile, Mepro is having some trouble with its success. Its factory and the Israeli military have reportedly begun competing to buy metal springs vital to both the Epilady mechanism and the army's rifles.

''This could be serious because we employ a large part of the capacity of existing production facilities for springs,'' Mr. Baruch said recently. ''We are overcoming this problem by ordering more machines to increase the production of springs.'' A Wire Is Twisted

The spring that catches and tears out body hair is placed around a wire, which is mechanically twisted into an uneven loop. In the production center where the wires are twisted, a dozen young men and women - some European kibbutz volunteers, others young Israelis - methodically insert straight wires into each machine, wait for the automatic twist and then remove the looped wire. They repeat this thousands of times a day.

No photography is allowed in this workroom. This is to protect the specifications of the looped wire, which are Epilady's secret, Mr. Baruch said, adding that Mepro spends more than $2 million a year battling infringement suits. U.S. Company Sued

As an example, he cited a current suit filed by Mepro against Remington Products Inc., the American company that manufactures a hair remover called Smooth and Silky.

When Mepro began planning its exports to the United States in 1986, Remington approached the company and offered to distribute the Israeli hair remover, Mr. Baruch said. But he said the deal fell through when Remington realized the device was revolutionary and was not willing to take the risk involved in backing it.

Now, after the success of Epilady, Mr. Baruch thinks Remington wants a piece of the action. Remington's hair remover was also developed by a team of Israeli engineers, he said.

''Smooth and Silky has a different shape, and instead of the metal coil we have, they put a rubber element, which does the same job based on the same system,'' Mr. Baruch said.

He said Mepro was also planning to apply for an injunction against Remington's manufacturing operations in the Far East. Remington's View

Kathleen Ivenko, Remington's corporate counsel, said in an interview that the Epilady patent ''is invalid as it simply follows prior art in the depilatory field.''

Noting that ''the United States Patent Office has issued a patent for Smooth and Silky,'' she said, ''Remington intends to file substantial counterclaims'' against Mepro.

Studies that show Smooth and Silky is much less painful than other depilatories also support Remington's contention that its product differs from the Epilady, she said.

Mr. Baruch acknowledged that Mepro received complaints about the pain and said that Epilady Ultra has been designed to be less painful.

Still, he said, ''there has to be some pain when you're pulling out hairs.'' Pointing to a bald spot the size of an orange on his forearm, he added, ''I know, because this is my test spot.''